Bitcoin and the illusion of money

Dubai. Greece. Spain. Portugal. Italy. Cyprus. Ireland. The list of countries needing financial bailouts seems to go on and on. And that’s before you include those banks in the US, the UK and beyond that were “too big to fail”. As well as revealing the fragility of the global economy, the current crisis has also raised some existential questions about the nature of money. Can any government really promise to protect the value of its currency and be taken at its word? And how – other than by hiding gold bars under their mattresses – can the residents of a country in crisis hope to safeguard their wealth? As a controversial economist once noted , there are times when all that seemed solid can melt into air. One recent and much-publicised answer to this last question is a form of money that comes pre-dissolved into the ether: Bitcoins. The world’s “first decentralised digital...